AMD Class Action Lawsuit Filed Over Security Flaws

The computer processor and component manufacturer Advanced Micro Devices (AMD) faces a class action lawsuit over alleged security flaws, known as Spectre and Meltdown, which could make a wide number of electronic devices susceptible to hacking. 

The complaint (PDF) was filed in the U.S. District Court for the Northern District of California on January 16, naming AMD, Lisa T. Su, and Devinder Kumar as defendants. Su is the company’s chief executive officer (CEO), and Kumar is the chief financial officer (CFO), senior vice president and treasurer.

These two exploits are known as “Meltdown”, allowing access to things like passwords and other information by cutting between an operating system and an application; and “Spectre”, which causes applications to leak information between programs that are usually isolated from one another, making data easier to steal.

Both exploits are believed to be accessible in every Intel and AMD chip made, and could put most people’s private data at risk. Some experts estimate that almost every CPU manufactured in the last 10 to 20 years may be affected.

In an effort to fix these problems, a number of companies have released automatic “updates” for computers, servers, cell phones and operating systems. However, these updates appear to cause the processing chips, the brains of computerized devices, to slow down anywhere from five to 30 percent.

Since news of the exploits and the patches began to spread, at least five Intel chip lawsuits have been filed in U.S. District Courts nationwide, alleging the company has violated warranty laws and state deceptive trade practice laws. That number is expected to increase significantly in the coming weeks and months.

The lawsuit against AMD is similar to cases filed against Intel for the same security flaws. However, this AMD class action lawsuit is filed on behalf of investors who say that the company misrepresented the value of its stock because it knew about, and failed to reveal, the security flaw in its processors.

“Throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies,” the lawsuit states. “Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) a fundamental security flaw in AMD’s processor chips renders them susceptible to hacking; and (ii) as a result, AMD’s public statements were materially false and misleading at all relevant times.”

The class action seeks to represent anyone who purchased or acquired AMD shares between February 21, 2017 and January 11, 2018. It presents claims of violations of the Security Exchange Commission Exchange Act and Rule.